Prime Minister Mark Carney and Alberta Premier Danielle Smith have reached an agreement on a memorandum of understanding that would grant Alberta special exemptions from federal environmental regulations and provide political backing for a new oil pipeline to the B.C. coast. The announcement is scheduled for a joint press conference in Calgary on Thursday.
As per sources familiar with the matter, the agreement hinges on Alberta adopting a more stringent industrial carbon pricing system and making a substantial investment in carbon capture technology through the Pathways Alliance, a group of oilsands companies. Although details have been shared with various sources, they are not authorized to speak publicly until the formal release of the memorandum of understanding.
The forthcoming agreement is anticipated to mark a significant shift in the relationship between the federal and provincial governments, which have experienced tensions in the past. The announcement is expected to be accompanied by a strong public relations campaign involving key stakeholders such as the Calgary Chamber of Commerce, the prime minister, the provincial premier, and other Alberta officials.
The agreement is likely to include exemptions for Alberta from federal greenhouse gas regulations, particularly Ottawa’s net-zero clean electricity rules, in exchange for Alberta strengthening its industrial carbon pricing mechanism. Implementing an effective carbon price on major emitters, like the oil and gas sector, is widely recognized as a crucial measure in reducing harmful emissions.
If the conditions outlined in the agreement are met, it could render the federal government’s proposed oil and gas emissions cap unnecessary, potentially leading to its removal. The federal government has also indicated plans to amend rules in the Competition Act to address misleading environmental advertising, known as greenwashing, a move that has been opposed by the Alberta government and industry groups.
Thursday’s agreement is expected to address the necessity for Alberta to engage in discussions with the B.C. government regarding the development of an oil pipeline to the northwest coast. Reports have indicated that the energy accord will also touch upon issues related to Indigenous ownership and participation, as well as the requirement for collaboration with B.C.
While discussions are ongoing, B.C.’s Energy and Climate Solutions Minister, Adrian Dix, emphasized that the agreement pertains to a speculative pipeline project without a finalized route or confirmed buyers. The Alberta government has refrained from providing further details, stating that more information will be shared in the days ahead.
The memorandum is also set to prioritize the completion of the $16.5-billion Pathways Alliance carbon capture and storage initiative, which aims to capture greenhouse gas emissions from northern Alberta facilities and transport them to an underground storage site near Cold Lake, Alberta.
Greenpeace Canada’s Senior Energy Strategist, Keith Stewart, has criticized the initial details of the memorandum, labeling it a “historic betrayal” of Canada’s climate commitments and Indigenous rights. Stewart expressed concerns about the potential surge in carbon emissions resulting from expanding oil production to fill a new pipeline, suggesting that it could outweigh any environmental gains.
Overall, the agreement marks a significant development in the energy sector, with implications for environmental policies and intergovernmental relations.
